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The Smartphone Wars: Bricks and Battiness

After the high drama of the last couple of weeks in the smartphone arena, it’s refreshing to encounter some good old-fashioned low comedy. We’ll get to more serious fare, but let’s take a look first at how astonishingly Microsoft just screwed the pooch.

Microsoft’s very first update to WP7, adding no features but intended “to improve the update process”, fails on some phones (requiring a manual reboot) and irrecoverably bricks others. Oh, yeah. Let’s just take as read the cheap jokes about very few users being affected because who bought a WP7 phone in the first place? I’m thinking those 50%-to-80% return rates we heard rumors of are about to go up, big-time. I’m also thinking that if I were a Microsoft stockholder I’d be eyeing the exits, and that if I were a Nokia shareholder I’d be running for them at full panic speed. This is what’s supposed to save Nokia’s bacon sometime in the future indefinite?

Anyone want to bet against the upcoming Android 2.3 update going smoothly? ….No? I didn’t think so. There’s a lot more trust in Google’s cluefulness going around than in Microsoft’s here in the 21st century. My hot-spare phone, the Nexus One, sits on my desk awaiting its OTA with languid confidence. I think my G-2 is feeling jealous…

There’s little comfort for either Microsoft or Nokia in comScore’s Mobile Year In Review, which gives us a fact- and statistic-stuffed take on the state of the smartphone market at the end of 2010. That’s nearly two months ago, which is quite a while at the frantic pace this market has been evolving. Still, if you pay attention to the measurements (and less to the forecasts) there’s much to be gleaned here.

Start with raw population sizes. Bearing in mind that comScore’s survey population covers only the U.S., Europe and Japan, they report 63.2M smartphone subscribers in the U.S. and 72.6M in Europe. That’s a 15% gap, shrunk from 25% last year. On the other hand, unlimited data plans are much more common in the U.S.: “Nearly one-third of mobile users in the U.S. have unlimited data plans compared with just 8 percent of mobile users in Europe.” There’s also much more 3G and 4G penetration in the U.S.

Yes, that’s right, according to this report U.S. users have faster and more widely-available data access than Europeans! This contradicts a widespread urban myth that state-owned telecomms companies and GSM standardization have added up to cellular Nirvana in Europe. Seems our messy competitive free markets have been doing a better job of deployment after all. Imagine that…

In other news, WAP is dead. Remember WAP? It, and special “mobile” presentations of websites, have been rendered effectively obsolete by smartphones running capable browsers. The report tells us the trend is, unsurprisingly, towards full HTML everywhere. This, of course, is tied with the almost dizzying speed with which smartphones have found their way into consumers’ pockets. The report’s lists of top-selling phones in 4Q suggests that, though Europe got a bit of a head start on this, U.S. consumers abandoned dumb phones more rapidly during 2010.

Smartphone penetration remains higher than the U.S. in certain European markets (Germany, Spain, Italy) but in general the U.S. and European markets seem to be converging. I’ve noted before that Europe and the rest of the world seem to lag smartphone tends in the U.S. market by about six months, and the numbers in this report (especially the smartphone OS share numbers) support that.

The single most serious defect in this report is that comScore’s OS market share numbers look somewhat stale relative to those being published by Canalys – this makes Android look a bit weaker than it probably is and its competitors look a bit stronger. (For a correction from reality see this report from Great Britain.) Nevertheless, comparing the U.S. and European market share graphs reveals interesting differences.

One major difference is the position of Nokia. It was the top-selling OEM in Europe through 2010 but barely on the radar in the U.S. market. Some unwelcome news for Nokia shareholders is that both markets are converging on the American pattern. The news from Britain and elsewhere makes it clear that Nokia is bleeding European market share to Android phones, as Stephen Elop acknowledged in the infamous “burning platform” memo. Ironically, Nokia’s miniscule market share in the U.S. isn’t crashing – perhaps because in this country the market has segmented in such a way that Nokia handsets are only competing with dumbphones.

Android looks to be gaining market share at about the same (rapid) rate in the U.S. and Europe, but in Europe the effective launch date was later so share there is lagging the U.S. figures somewhat. Other smartphone lines are maintaining pretty much the same relative positions in the U.S. and Europe, all except Apple losing share to Android at comparable rates. In both the U.S. and Europe, Apple managed a just barely perceptible gain in share, but spent the year eating Android’s dust.

This pattern is interesting because, along with the overall convergence in scale and smartphone penetration, it suggests that the underlying drivers acting on consumer demand and preferences are quite similar in the U.S. and Europe. comScore ventures to this conclusion from a slightly different reasoning. It also notes that the Japanese market is quite different from either.

Here’s a surprise about a trend in both markets: “Even though applications received much more attention by the media throughout 2010, our analysis in the U.S. and the EU5 region showed that by a small margin, application usage is still second to browser usage when it comes to the mobile web.” I’ve voiced suspicions here that apps are less important to phone users, and less valuable as discriminators, than the smartphone OS pushers think they are; this seems to confirm that.

Since I’m mainly interested in reporting on and analyzing the smartphone market’s competitive dynamics, I’m not going to dive into comScore’s material on mobile device usage patterns and how they vary by market. There are in any case few real surprises there – social networking is exploding in popularity, the advertising market is vigorous, etc. One pattern they half-illuminate is that smartphones are not yet replacing browsing on PCs; smartphone consumers show a strong pattern, sorted by time of day, of preferentially using PCs (and their large displays) when those are available.

Circling back to NoWin – is the comScore report revealing a market in which there is any hope for them? I’d have to have said “no” even before the update fiasco. Android is kicking the living crap out of competition that’s here now; unless current trends in both the U.S. and Europe reverse dramatically it will have cemented a solid majority market share well before the earliest date Nokia thinks it might ship a WP7 phone. The best recent bet for a reversal of trend would have been for the Verizon iPhone to take off like a rocket rather than fizzling on the launchpad, but it’s probable that would have helped NoWin not at all.

And it would have to be some really dramatic reversal. The comScore numbers show that there’s nothing noisy or jittery about the trends in Android market penetration, neither in the U.S. nor Europe. What we’re seeing in both markets is an inexorable rise that hasn’t even been measurably affected by competitive countermoves. The iPhone 4 and iPhone V failed to even speed-bump it, let alone stop it, and the handful of WP7 phones are now an even sadder joke than they looked when I predicted on launch day that they would flop.

Apple has strategic problems; it’s being badly disrupted from below in the smartphone market, and I think will begin to experience the same in tablets towards the end of 2011 But I don’t see these challenges becoming acute for a couple of years yet; Apple can maintain a profitable high-margin business for a while even with drastically lower market share than it has now. In fact that’s what it wants to do culturally speaking.

The major unknowns of the near future concern companies without Apple’s maneuvering room or brand strength. In particular: Will Nokia bail out of the disastrous NoWin alliance? And, what’s RIM going to do? But those, dear readers, are topics for another time.

94 thoughts on “The Smartphone Wars: Bricks and Battiness”

I’m sure the Churchill quote “…will always do the right thing – after it has exhausted every other option” has often been used in reference to Microsoft. So they get the mobile OS wrong about five times, then they get it somewhat right, and then they decide to try Patch Tuesday on it.

Hmmm. Word Perfect is gone. WEP is not secure. WAP is gone. Now WP7 is no good. If your last name begins with a P, it should still be OK to name your child William or Wanda though, because all humans are mortal.

> In particular: Will Nokia bail out of the disastrous NoWin alliance?

They seem to be hedging their bets at least in a small way. Nokia’s CTO Rich Green says in this video that they’ll ship a “N950”, a successor to the N900 with Maemo and Qt, this year, which sounds like “before the first WP7 device”. He says that the project is fully staffed but that they don’t have a plan for the code base beyond the release of the upcoming device. I’m sure that’s a great morale boost to everyone involved.

No question that WAP is a goner, but Web mobile editions aren’t going anywhere. A touchscreen smaller than the human hand simply doesn’t handle traditional Web sites easily, with their navigation bars, dynamically changing forms, and (most obnoxious of all) drop-down Javascript menus that have a live link on the top-level button.

Well-crafted mobile editions, with large links, limited page length, and low numbers of external references (latency is still quite high on even 4G connections) are tremendously valuable. I even use an app on my Pre that essentially does nothing but reformat Wikipedia (and other MediaWiki pages).

The patch fiasco is not surprising, really. I’m not sure it’s in Microsoft’s culture to compete manipulate in a space where they don’t already have vendor lock-in. It would require them to actually make a product that works and that people want. Apple and Android have already staked huge claims in the mobile space, and this is not the late 80’s/early 90’s, where only enterprises have these new-fangled things called PCs and Microsoft could more effectively FUD their way into dominance. Now we’re 25-30 years into mass usage of the PC, and I think people have a sense of what works and what doesn’t work. And let’s face it, people want to use machines that work. You turn on the TV, it works. You pick up a phone, there’s the dial tone. This community may recognize the potential in a pocket-sized computer, but I would argue the majority still sees it as an artifact, right next to the blender and hair dryer…and with the same expectations for usablility and reliability. This is where Microsoft fails, and iOS and Android have succeeded.

As an aside, I’m soliciting ideas for what to do with a shiny, new Linux Mint 10 box. Any thoughts?

I guess what I meant was “if the failure of the WP7 phones is obvious and recognized by Nokia’s management before they’ve completely dismantled their Maemo/MeeGo team”. Nokia has a knack for rapidly disbanding teams behind successful products, and I suppose under the circumstances their Maemo/MeeGo group is probably suffering from brain drain as it is.

“Yes, that’s right, according to this report U.S. users have faster and more widely-available data access than Europeans! ”

I can at least partially confirm that. At the moment I live in Austria and my former boss said an interesting thing: “The mobile phone provider business is about one level up in ethics from selling crack cocaine.” I think he meant mostly the Internet access provision part of it, for calls are cheap enough, in roaming (abroad) too. As for the Internet, the better phones are typically sold with 4-8GB packagess which aren’t as good as the unlimited ones but they could be acceptable, except that they
charge insane prices the moment you try to use it abroad (roaming), as in, use Google Maps for GPS.

Now, this might not sound like a big problem, but only until you realize that Austria is smaller than the state of Maine and any city other than Vienna over 1M people are by definition outside of it – and this is why I am totally pissed off about it, I want a whole-EU, fixed-price, unlimited, reasonably charged data package at around $30-60 a month, and this is exactly what I am not going to get in the next 2-3 years.

@Richard: It’s usable, but Wapedia’s still better, especially since it will autocomplete article titles and I don’t have to type the URL (plus it supports other wiki sites). And I started using Wapedia before Wikipedia’s mobile view was quite so usable.

I’ve been following the rise of Android with much interest and satisfaction. I enjoy the exchanges on this blog very much of have added much useful info to my wetware “database” ;-) However, one of the things I have been trying to frame clearly in my mind is the Android vs. Apple thing (especially regarding the market analysis mentioned in the post).

What is really being said here? Android is an OS, a platform, but Apple is a company. How is it that the argument has been Android vs. iPhone (rather than say Android vs. iOS)? Or is that the actual argument and “Apple” is the general reference used to simultaneously identify multiple criteria in the argument (since I see the same arguments now being applied to the tablet market war)?

Is it that, or is it really still an argument of philosophies (open vs. closed)? I can see the Droid (or other high-end model) phone vs. the iPhone, but haven’t clearly identified the parameters of the OS vs. some company or some company’s product arguments clearly in my head yet. Is it just linguistic semantics here that I’m kind of over-thinking?

I think there’s some elements to be found in a number of Winter’s posts to (referring to the PC battles of old), to consider while I’m thinking through this, but just haven’t been able to identify the actual arguments clearly in my head yet. I’d like to develop a firm and clear grasp of what is actually being said/argued here before I add any further comments.

It’s just a simple matter of semantics, really. Apple has made it clear that they will forever be the only manufacturer of handsets running iOS — and as a result, “Apple” “iOS” and “iPhone” are pretty much synonymous for any discussion on the topic. We are, for all practical purposes, comparing ecosystems rather than individual products.

What’s happening now with smartphones is nearly identical to what happened with personal computers two decades ago. Apple had total vertical integration, while Microsoft had a menagerie of hardware providers. Now it’s playing out the exact same way, except *faster* because Android is free (better than free, actually: Google does a revenue split on the ads for any carrier that uses the official build) and, unlike Windows 3.1, doesn’t suck.

Microsoft is, for all practical purposes, just entering a race that has been almost completely run already.

> This contradicts a widespread urban myth that state-owned telecomms companies and GSM standardization have added up to cellular Nirvana in Europe.

The first GSM network was the privately owned Radiolinja in Finland at a time when the state-owned operator was in a very dominant position. The “GSM Nirvana” trick was that Finland and at least Sweden, too, sold the GSM operating licenses to the operators at a nominal price, having the foresight to foster the technology rather than to try to extract revenue for the state. Some of the other European states didn’t quite see it that way. So the initial success was very much because of private enterprise with enlightened government support. Finland has had lively competition between the operators to this day and fixed-price, unlimited data plans are available at good prices, but the country is only a small part of the EU, of course.

Part of the 3G/4G problem was that the large European states sold the network operating licenses in auctions at the peak of the internet bubble and the prices got completely out of hand. The operators that survived the resulting debts are probably still paying for that adventure. Finland, again, sold the licenses at nominal prices, but the descendant of the state-owned operator, Sonera (nowadays TeliaSonera) dug itself into a hole in an insane bidding contest for a German 3G license. Sonera was actually later bailed out by the Finnish state with much wailing and gnashing of teeth.

I laugh when you describe it this way, because by your own account the “enlightened government support” consisted of refraining from charging exorbitant fees for use of a resource that players in a free market would have homesteaded on the model of land tenure if the government hadn’t yelled “Mine! All mine!” and enforced that with guns and goons. Sigh. We nearly got common-law tenure of frequencies (interference treated as trespass, etc.) before the U.S. government seized the lot in 1934, setting an evil precedent which other governments promptly emulated.

Still. Even with a government doling out spectrum, you present a much less dirigiste picture of what makes Scandinavian telecomms work than we usually get from advocates of “European”-style regulation. Thanks.

Commenting on the tablet market, Apple has an opportunity to completely smash Andriod in the tablet market, if they were to just put out a cheaper device. Something like a 7″ iPad starting at $350 with say 8gb of storage for their WiFi only model.

The size difference would let it coexist with their 9.6″ iPad while the lower price would entice away would be Android tablet buyers. Plus, if they kept nearly the same specs as their current iPad, the engineering cost would be fairly low, so they could push it out to market fairly quickly.

Just like how the iPod has a 50-60% share of the mp3 player market, due to its variety of prices, sizes, and features, the iPad could do the same thing for the tablet market. If only Apple were to follow their prior iPod battle plan.

ESR, I know its your blog and you write about what you want to write about, but isn’t it time now to change the tag line for the blog to “smartphones, smartphones, smartphones.”

I am truly very interested to hear what you think of the unrest in the mideast, the unrest in the midwest, or about our federal government’s mess. You have a great libertarian viewpoint which lead to me reading the posts that got me started visiting your blog. I keep you on my RSS feeds hoping to see a post on something other than smartphones, but I’m checking less often.

Again, It’s your blog so do what you will, but I do wish to hear about more topics from you.

>Again, It’s your blog so do what you will, but I do wish to hear about more topics from you.

What, Heavy Weather and Bad Juju wasn’t enough red meat for you?

As I’ve commented before, I’m writing about politics less precisely because I think the end of politics as we’ve known it (ever since the rise of the Bismarckian state 150 years ago) is nearly upon us now. But I hear you. I’ve been thinking about blogging about the real size of the stakes in Wisconsin, anyway. Perhaps I’ll do that soon.

Seems to me that MS let the genie out of the bottle by allowing some limited OEM customizations so they could “differentiate”. The case is only made more hopeless by the apparent freedom Nokia has been given. MS is going to have a tough time with that genie, which will complicate their update process forever.

I can easily envision how the Samsung scenario might have happened. An MS engineer tells an MS sales guy “A”. The sales guy hears “B”, sugarcoats it a little, then tells “C” to a Samsung purchasing guy, who hears “D”, and adds his coat of sweetness before telling a Samsung engineer “E”. Simplistic, but it sure looks like Samsung designed something into the phone(s) that didn’t belong or left something out.

The one question I have is why they didn’t include a bulletproof recovery option that allows the user to recover from an incomplete or stalled update regardless of the cause. I flash my Android phone occasionally and fully understand that an incomplete update (caused by me pulling the cable out or a power outage during the process) puts my phone at risk. If I were a WP7 owner, I wouldn’t tolerate that risk. No matter what I do to my phone during an update, I should not be able to brick it. Period. That’s one of the selling points of WP7.

I find it amusing that I see tips in the WP7 forums about dialing #BR-549# then press Send, and things like this in an official Microsoft forum…

1. Check if the phone is capable of getting into the ‘download mode’. To do this: Turn off the phone (or remove > replace battery), then turn it back on by pressing the power/camera/VolumeUP buttons simultaneously. When the phone turns on, release the power button. If the phone shows the yellow triangle with exclamation and a “download mode” message, your phone is capable of getting into the ‘download mode’, and you can proceed to step 2.
2. Download the following files (be warned: multiupload.com is loaded with huge ad’s/pop-ups)
– Firmware I8700XXJK1 ## 2010 November CSC_Cetus_Europe_I8700XENJK1: http://www.multiupload.com/OGUYF4F3VA (rar-file password: samfirmware.com)
– Samsung WP7 Flash Program: http://www.multiupload.com/3OE4SYAGQA
– Samsung Mobile USB Drivers V5.2: http://www.multiupload.com/GH391NDSY1
– Flash Guide (English): http://www.multiupload.com/FDRJ3WDZQ7
3. Unrar / install downloaded files
4. Make sure the phone is disconnected from computer and turned off
5. Reboot computer for the drivers to complete install.
6. Start Samsung WP7 Flash Program.
7. Turn on the phone in ‘download mode’ and then connect it to the computer
8. Drag the 4 files from the unpacked firmware rar-file to the Samsung WP7 Flash Program dialog screen. The application will place each file in the correct field.
9. When the phone is recognized you can use the ‘Start’ button to start the flashing process.DO NOT INTERUPT THIS PROCESS!
10. When the flashing is done (aprox. 15min.) the phone will automatically reboot and show the welcome screen.

If I had bought “The Phone For The Rest Of Us” I’d not be a happy camper…

“The Park Slope Food Coop, in Brooklyn requires members to work shifts there. A blogger said she had heard that some were sending nannies…to shop at the co-op, each member must volunteer a certain amount of time there, typically 2 hours and 45 minutes every four weeks. Shirkers are penalized by having to work twice the amount of time they missed.

“That all members should be equal as they enjoy their organic apples, locally made kimchi and upstate organic beef at sweat-equity prices is the root of the utopian ideals on which the co-op was founded in 1973.

“So the allegation by a Park Slope blog last week that some members were sending their nannies to fulfill their work shifts has raised eyebrows and debate among the granola-and-strollers set.”

Humor aside, there’s a fundamental point of economics here that is ignored by the co-op rules. If I value my 3 hours a month more than $X, and I know someone else who values the $X more than 3 hours a month, it clearly improves the net welfare if I hire that person to do my shift for $X. Demanding that *I* must be the one to do the labor goes against the whole economy of specialization that has lifted us above the subsistence level. Economic inefficiency in the name of egalitarianism is misplaced.

On the other hand, if you carry this to its extreme, you get American Civil War-style hire of substitutes to take your place in the military draft.

I’d love to hear ESR’s thoughts on this from a libertarian point of view.

@hsu:
> Apple has an opportunity to completely smash Andriod in the tablet market, if they were to just put out a cheaper device.

Nonsense. The iPad is already highly price-competitive with the other big name tablets. But, if they continue to obstinately stick with the current iOS design model, and resist actually evolving it, they’re gonna lose in a big way. I’ve been playing with Android 3.0 in the SDK emulator, and it is _neat_ and looks fabulous. Apple better pull one hell of a rabbit out of its hat this summer, or they’re in big, big trouble when cheaper, functional Honeycomb-able tablets follow up the Xoom.

Humor aside, there’s a fundamental point of economics here that is ignored by the co-op rules.

Since when are clubs about economics? They are lifestyle choices.

Demanding that *I* must be the one to do the labor goes against the whole economy of specialization that has lifted us above the subsistence level. Economic inefficiency in the name of egalitarianism is misplaced.

Demanding that you strip and wear the moose head is probably economically inefficient as well. Nonetheless, if it’s what you have to do to get in the club, you do it, and then once in the club, either try to vote to get the rules changed, or insist that other new members wear the moose head because you had to once upon a time.

The last paragraph of the article you quote from was telling:

“[One Cuban immigrant’s] assessment of the co-op is that the co-op is worse than socialism,” she said. “Because at least in a socialist country, if you know the right people, you can get out of it.”

That’s complete, utter, bullshit. Nobody is forcing anybody to join the coop. You can buy your food where ever you want. The right to free association has been reduced by the government considerably, but anybody publicly fighting for the “right” to pay a substitute to do his duty in a club setting will almost certainly be taught lessons by the judiciary, any political party that happens to be in power, and the Streisand effect.

The GSM standard effectively broke the state monopoly on communications in Europe. (I remember my father getting his first GSM contract with a private operator as a matter of principle). As far as I know all EU countries have several mobile operators, and quite a few have completely privatized the former state telcos. And because of the GSM standard and number portability changing providers is quite easy. Just compare the Churn rates on both sides of the Atlantic, and you’ll see where the market works…
When you want to buy a mobile phone in Europe you typically go in to a mobile phone shop, or a megastore. There you first pick the phone you want, and then you can pick any plan with any provider. Depending on the plan you commit to you’ll get a rebate on the phone. When your commitment with a provider ends you can extend it (and the provider will usually thrown in a another subsidized phone) or you can change to another one, keeping your phone if you wish. Or you just give your old phone to a nephew who gets himself a prepaid card at the local convenience store and is on the air in seconds.
I think that from the point of view of the consumer the mobile phone market works quite well in Europe.

If you’re taking requests, I’d love to hear your perspective on Apple’s recent App Store moves (subscriptions, mandatory in-app purchase, threatening apps like Rhapsody / Kindle / Netflix, etc.). To me they make no sense. Apple is giving Android an additional boost (since Google is structurally incapable of making the same moves with Android) at a time when Android already has plenty of momentum. Or have they already conceded the war and are starting a tactical retreat?

@esr
“because I think the end of politics as we’ve known it (ever since the rise of the Bismarckian state 150 years ago) is nearly upon us now. ”

Indeed, what we are seeing is the rise of politics as practised in China, India, and South America. Pick your choice.

You most likely already read “After Tamerlane: The Global History of Empire Since 1405” by John Darwin.

I would like to draw your attention to one of his final conclusions. The fact that the “nation states” were a post-medieval Eurasian invention which also took root in the Americas. All the old big countries that emerged from the 15th century, China, India, Russia, Egypt, Turkey, GB, France, Iran, still exist as political entities, many with borders that are eerie close to the original. The same holds for a lot of smaller countries. Even today, most of the political problems of the EU can be traced back to the refractory nature of nations.

Five centuries seem a rather respectful history for a political practise. The “Bismarckian State” just seems a late German entry in that arena. And even “young” Germany survived a pretty traumatic history. In short, I am afraid that the nation state has taken root in Eurasia and the Americas, and some pretty deep roots they are.

You could get a free Nexus One free with a 24 month contract for around 25 euros/month with unlimited data, good 3G coverage, 200 minutes/sms per month. Beyond the borders, things get ridiculously expensive very fast. The EU has put a hard limit of some 60 euros on data roaming charges. Too many people came home from vacation to find roaming charges of hundreds (thousands?) of euros. Maybe a local prepaid SIM card is cheaper.

Laptop dongles seem to be always metered. No idea how expensive they are in practise.

> Laptop dongles seem to be always metered. No idea how expensive they are in practise.

Not so in Finland. E.g. my operator offers unlimited plans for 10 e/month for 1 Mbit/s and 14 e/month for the maximum speed of the network, up to 15 Mbit/s. The contract is for 24 months and the dongle comes free of charge with a new contract.

@Mikko
I should have done my “research”. It seems you might indeed be able to get “unlimited” data on your laptop for around 10-20 e/month. However, it would take some time to actually parse the exact specification to be entirely sure I would get what I think I get.

>Nearly one-third of mobile users in the U.S. have unlimited data plans compared with just 8 percent of mobile users in Europe.

Interesting.

I wonder what impact operator subscription and subsidy models have on these numbers.
Do consumers elect to sign up for flat-rate data plans because they want/need one, or is flat-rate data something operators push more aggressively in the US (for instance making them a prerequisite for getting the very latest handsets on subsidy)?

It would be interesting to see some data on acutal usage among flat-rate subscribers in the US and Europe. Are flat-rate data plans typically a net win for the consumer or for the operator, and is there any difference between the US and Europe in this regard?

‘early one-third of mobile users in the U.S. have unlimited data plans compared with just 8 percent of mobile users in Europe.’

Other things to consider:
– Lots of mobile phone users in Europe aren’t on any kind of plan. Prepaid is very popular, even for data.
– There are more mobile phone subscribers in Europe relative to the population than in the US. Every second Italian has two cell phones. I doubt many people have two smartphones though. With about a third of the phones in Italy being smartphones you could actually assume that half the Italians have a smartphone…
– A lot of the limited data plans have very high limits that the users rarely reach.

It would be interesting to compare the plans in the US with those in Europe, especially how many different there are.
In a typical phone shop here in Switzerland every phone will have a price label with a listing of plans for different carriers, what these plans cost and offer, and what the phone will cost if you commit to that plan. I often wonder if some carriers inflate the number of plans they offer artificially in order to claim more space on the price tables… Competition is quite fierce, and the hardware side has been essentially commoditized.

One last remark to ESR: That the market doesn’t gravitate to your preferred offer doesn’t mean the market doesn’t work. The European telecommunications market is highly competitive, with most former incumbent state monopolies having been privatized partially or in whole, and fighting for their bottom line… I would suspect competition to be even fiercer than in the US (does anyone have data on advertising expenditures?).
T-Mobile is still one third owned by the Federal Republic of Germany however.

Strange that people think mobile telecomms is state owned in “Europe”. In Britain it certainly isn’t; in fact, Britain has the largest mobile phone company in the world. I’m pretty sure it isn’t in France, Germany, Spain, or Italy either, and that’s just the few others I’ve personally visited.

As I understand the US phone market was severely retarded by a ham-fisted “pro-competition” (though surely anti-private property) initiative that divided rights up to individual cells and placed impediments on companies merging or buying up large chunks of network. Possibly why people here in Britain don’t call them “cell phones”. But I may be wrong there.

Overall this Europe = socialism meme is overdone by both sides of the political spectrum in America. It’s more like America is 45% socialist, while European countries vary from say 45-65% (yes, I’d put Switzerland on par with America). And that doesn’t always come in the same places, either. While Sweden is seen by many as the archetypal Euro-socialist state, and it certainly has much higher taxes than USA, it doesn’t, for instance, have a minimum wage, and Britain with its NHS has far less union militancy than the USA seems to.

ALCON,
I’m surprised at some of the pro-Apple rhetoric I see from time to time here. Admittedly, I am biased toward open systems in most cases, and Android in particular, but I believe the writing is on the wall, even penetrating my personal bias here. Android has single-handedly kicked open the market, making it avail to many potential vendors from technological and manufacturing perspective. On the soft-side Motorola was the first to provide the “cool” factor competition with the Droid (and now the newest Xoom in the tab market), and can compete with Apple’s “elitism” in price for those units for sure. Motorola (and now Android by extension) has also managed to capitalize on the current “geek chic” trends with these technologies.

Apple will probably be around for a long time to come because for the moment they have the Mercedes and BMWs of the market (but look what Hyundai and Kia are doing to them). In the end, I think Apple will die the same slow, languishing death Microsoft is experiencing now. The singular, big animal will be eaten alive by the mass of army ants, unable to react fast enough to survive. Also, that’s what happens when you allow your company to be tied too closely with one persona and a few core technologies or products (though I confess I recently read some interesting things about Apple’s “board of directors” and the realities there – too off topic to discuss though).

I believe Android is now proving the Open Source philosophy in full force in a way that I’m not quite sure happened with the PC/Laptop wars (although it certainly HAS had a major impact there). Now its everywhere and in everyone’s face. We are tethered to our comms devices more and more. One of my hobbies is to map and theorize about the future of our species – not a singularitian fanatic, that’s a bit utopian for a species that will retain an inherent humanness for a while to come, but the probable evolution of true cybernetics is certain. I believe one can look to the happenings in the smartphone market and see that the “Android approach” is the one that will take us the furthest, fastest, and because of that, it is the approach that will be the most likely to dominate technological development for here on. Hell, it’s the approach that got us here in the first place (the Internet and Web). And now the “average” person sees it. Those who believe that the average person is unaware that Android is a philosophical technology and merely a new player on the market I think are gravely mistaken. Android has been tied with Google, and the world is well aware of the Google message.

@shenpen
“predictions that we are heading back to a pre-westphalian global system.”

I think that is too (West-)European in outlook.

If you take a look of the world in 1550, you have a number of powerful “imperiums”: China, Moghul India, France, GB, Russia (just starting), Turkey, Egypt, Iran, Spain. Some of these can be traced back to antiquity (China, India, Egypt, Persia). Fast-foreward to 1950s, and look at big political entities. Why do we find again, China, India, France, GB, Russia, Turkey, Egypt, Iran, and Spain (quite small now)? Why did 4 centuries of turmoil and colonialism not destroy these political entities?

I was referring to the answer of John Darwin gives to this question. He poses that the Nation State, codified in the treaty of West Phalia, was actually a Eurasian invention of the late middle ages. Something that rose from the ashes of the Mongol conquests. Or maybe it is simply the result of better communications.

If he is right, then we might see nation states rebuild on the ruins of anything that tries to destroy them. Much like Germany was rebuild several times.

Well-crafted mobile editions, with large links, limited page length, and low numbers of external references (latency is still quite high on even 4G connections) are tremendously valuable. I even use an app on my Pre that essentially does nothing but reformat Wikipedia (and other MediaWiki pages).

Same here on on the Evo. Wapedia. Even with the Evo’s generous 4.3″ 480×720 screen, I find it much easier to read Wikipedia in Wapedia in than in Android’s fully-functional WebKit-based browser. WAP is just HTML with different styling; what I’m seeing more and more are websites with a special CSS stylesheet for mobile browsers, rather than WAP. This is the way HTML 5 / HTML 4.x / XHTML 1.x were intended to be used, of course.

As I’ve commented before, I’m writing about politics less precisely because I think the end of politics as we’ve known it (ever since the rise of the Bismarckian state 150 years ago) is nearly upon us now.

I’d be interested to hear your predictions or even speculations (and those of the widely-varying community around here).

@Winter: Are you seriously claiming that you don’t understand the difference between the nation-state and the Bismarckian State? Do you even know that the term ‘Bismarckian State’ means, in this context? Because you really should…

@Greg
Sorry, I know about Bismarck and Prussia and the unification/industrialization of Germany and some of Italy. But Bismarckian seems to signify some political facet of this historical process. I have never seen it used in Europe outside history.

>Bismarckian seems to signify some political facet of this historical process.

Right. The ‘Bismarckian state’ refers to a phase in the evolution of nation-states that began with Otto von Bismarck’s institution of the Prussian state pension system in the 1840s, just about 200 years after the emergence of the “Westphalian state” after the Thirty Years War. To avoid further jacking this thread I’m going to leave it at that for now. I’ll post on the topic soon.

Point-of-sale terminals, kiosks, advertising displays, those monitors which show when planes/trains depart/arrive.

Currently these niches appear to be dominated by embedded installs of Windows. And I don’t mean Windows Embedded, but anything going back all the way to Windows 3.1 (seen in a MAX light rail ticket vending machine in 2006). But the application form factor and interface is right up Android’s alley. iOS’s, too, but this application is too bourgeois for Apple, excepting deployment in their own creepy retail outlets of course.

Once this starts happening, tapping your Android phone to complete a transaction with an Android vending machine or ticket booth will rapidly become commonplace. Tackling many niches leads to ubiquity. Being open source enables customizability to many niches. World domination, at last, is at hand. Mwahaha.

And I don’t mean Windows Embedded, but anything going back all the way to Windows 3.1 (seen in a MAX light rail ticket vending machine in 2006).

That reminds me of when one of the bus terminal timetable displays had reset and there in all it’s glory was the C-64 start screen. That gave me some warm and fuzzies at the time (unfortunately they’ve upgraded since).

Tackling many niches leads to ubiquity. Being open source enables customizability to many niches. World domination, at last, is at hand. Mwahaha.

Yes, in my own world, I often repurpose off-the-shelf stuff for my own uses. For example, at one point, I built about 40 modem emulators in nice looking aluminum external 5.25″ CD-ROM enclosures, and I’m always building boards that can hook up to AT power supplies.

I can’t wait until all the compute I need in the lab is powered by PogoPlugs and all the displays are Android…

WCC, I think you and esr and others here are way, way off about Apple’s impending doom. Apple has been growing by leaps and bounds, can barely keep up with demand, and makes the lion’s share of the profits in smartphones.

The success of Android doesn’t mean the death of Apple. Apple has some needed competition, yes, but they’ve never been less “doomed” than they are now. They have advantages that Android cannot match: superior overall design sense, tight hardware/software integration, economies of scale, little to no platform fragmentation, little consumer confusion, etc. They also have the major advantage that they can, if they decide to, easily take away many of Android’s advantages (e.g. by lowering prices, adding features, reducing App Store restrictions, etc.), while Android cannot easily match Apple’s economies of scale, hardware/software integration, etc.

It seems clear to me that there is a healthy competition evolving. Apple is certainly in the lead: before the iPhone, Android phones were going to look like Blackberrys. Before the iPad, Android tablets didn’t really exist. Before the App Store… etc. Not to be rude, but Android needs Apple to know where to go next.

On the other hand, Android will keep up the pressure to force Apple to be more open, keep prices low, etc. Fine. But it’s premature and silly to think that Apple’s doomed.

>On the other hand, Android will keep up the pressure to force Apple to be more open, keep prices low, etc. Fine. But it’s premature and silly to think that Apple’s doomed.

Er, straw-man alert. Nobody in the discussion has said “doomed”. The most radical prediction was, I think, mine – that Apple will end up with smartphone market share comparable to its PC market share. That is, in the 10% range.

>I think “doomed” is a fair summation of WCC’s above statement, and yours [Then they want death, and will get it.] on February 18th

That was a conditional. See, I don’t actually think Apple’s planners are as stupid as the person I was replying to made them out to be – my line was a knock on the boneheadness of the strategy, not of Apple.

>How come no one ever mentions that Apple has a considerable first mover advantage?

Apple had a first-mover advantage in PCs (Apple II), and then in PCs with GUIs (Mac), and then in phones (but now Android has passed them in marketshare). Being first with hardware doesn’t seem to help when you’re followed by an army of clonemakers who all use the same software.

Winter Says:If you take a look of the world in 1550, you have a number of powerful “imperiums”: China, Moghul India, France, GB, Russia (just starting), Turkey, Egypt, Iran, Spain.

Imagining 1550 Spain as a Westphalian state is anachronistic. China has a history of being somewhat like a Westphalian state on and off for a very long time, and arguably it was something like a Westphalian state as early as 1300, but it never imagined itself as part of a Westphalian system. Moghul India was never anything like a Westphalian state.

The Kings of Great Britain and France claimed to be kings of overlapping territories, and in fact their territories did overlap, thus not Westphalian states in 1550. Russia was not a Westphalian state until long after Westphalia, indeed one could argue it never became a Westphalian state until the fall of communism. What are the historic boundaries of Russia? Turkey did not exist as a nation state until 1922 – certainly no such entity in 1550. Egypt did not have an Egyptian government until 1805, and one could reasonably argue it did not really have an Egyptian government until 1922.

Westphalian states existed in a small part of the world starting with the peace of Westphalia. Decolonization exported at gunpoint a superficial simulacrum of the Westphalian system to the entire world, which simulation is starting to evaporate.

@James A Donald
In the three decades after the 1648 treaty that ended the 30 year war between Sweden and the assorted German states as well as the 80 year wars in the low countries, Louis XIV ran over the German speaking territories of what is now North and East France upto the Rhine, West Phalia, and the low countries up to Amsterdam. Please forgive us for not putting all too much importance to a few lines of “State Souvereinity” in that treaty.

Egypt has been a self governed nation during the old pharaon reigns. So have been China, Japan, and many of the others. I will not go on to debate why other times and places did not use 17th century European technology to secure their borders and collect their taxes. That was not the question John Darwin was trying to answer.

That question was why the Russian empire running from the Baltics to Wladivostoc, founded after the fall of the Golden Horde (and the plague) still exists. As do the Indian empires of the Mughals and Rajput which are now the centers of India and Pakistan. Not to speak of Ming China, Shogun Japan, and Iran. Turkey started as Turkish Anatolia in the 15th century.

As I now understand the remark of Eric was about state pensions, I see that this is totally irrelevant to that discussion. I did not understand that remark because on the very long list we keep in Western Europe of things we credit and blame Bismarck for, state pensions are way down at the bottom.

Any understanding about Eric’s opinion on these Bismarck-states from my part would be complete guesswork, as I am currently too lazy to research that. I will simply wait and see whether I have something useful to contribute. (It is better to be silent and thought a fool than to speak and remove all doubt; which is difficult enough to observe as it is)

Or as a friend of mine likes to say: “Technology isn’t real until you can buy it for twenty bucks down at the WalMart.”

There’s a little more to that statement than might immediately meet the eye. If you can sell a fancy alarm clock or MP3 player or whatever for a small amount through WalMart, and have enough margin and few enough returns to actually make money, then, yeah, your technology is real…

Microsoft has revealed that 1 in 10 users who tried to install a software update on their Windows mobile experienced problems.
The company had previously said that only a “small number” of handsets were affected.

Q: How many users are affected?
A: Worldwide, we’ve seen a 90% success rate for customers attempting to install this update. Of the remaining ten percent, the top two issues encountered are the result of customer internet connectivity issues, and inadequate storage space on the phone or PC. These account for over half of the reported issues with this update.

Also read the comments:
@bnlf : so how come Android phones haven’t had that problem.

“Messing around with the system” is basically what HP does with Windows (sans Phone) 7. Their start menu is a butterfly and several other hacks. If Windows Phone 7 was indeed a mature build, no problem will have occurred.

The real problem is not the UI which is just a fancy makeover using Silverlight. The problem lies on the underlining OS (Windows CE 6.0 R3). It’s damn buggy (aka the R3 release) and am sure most of the bricking on the Omnia was a result of incompatible device drivers.

With that said, Windows Phone 7 is a fancy OS hidding a bug ridden, never complete OS refresh that Microsoft started just after Windows 95 and never actually completed. All OEMs had abandoned Windows CE and rather than fix it, they changed the name to confused the non-technical guys (now it’s called Windows Embedded Compact 6.0 in line with the successful Windows XP Embedded and Windows Embedded Standard).

Oh. My. Goddess. WinCE is, by reliable report, the second-worst piece of crap Microsoft ever shipped. (Not even WinCE could match the cosmic suckiness of Microsoft Bob, which is explained only by the supposition that its program manager was fucking Bill Gates. Well, at least she married him afterwards.)

If I needed any confirmation that WP7 is doomed, you have just supplied it.

Speaking to ZDNet about reports that some phones were becoming unusable after the update, a Microsoft representative said the company had seen a 90-percent success rate by customers who were attempting to install the update.

Aye, PapayaSF, “death” was an improper word. And I agree that the success of Android does not necessarily mean the death of Apple. I confess, once framing the Android/Apple argument in terms of competing ecosystems in my head, I did not apply my anti-either-or filter before posting.

I think perhaps I should have picked the word “marginalization.” And as such, I should say that I do not believe that Microsoft will ultimately die either. What I think is much more aligned with Mr. Raymond’s predictions – I believe that Apple will become much marginalized in the markets they have either initiated or decided to play in. This has oft happened to first-movers especially. Now, whether or not they are consciously moving in this direction I do not know. I can certainly believe a scenario where the market approach is something like “yes, you can acquire similar systems but you want OURS, we’re Apple, we’re first, we’re best, etc. etc.” I can certainly point to some examples from my world where people choose certain equipment because it is from a certain manufacturer, although the main competitor was second to market and often produces same/similar/superior gear at less cost.

I am also in agreement with Mr. Raymond’s statement in post [ February 24th, 2011 at 11:34 pm ]. As alluded to in my previous post [February 23rd, 2011 at 6:05 pm ] I believe Apple’s “steering committee” has some significant planning and strategizing capabilities.

Regarding the advantages you cite for Apple:
…design sense: This is a temporary advantage. This can be acquired, especially when a company has more resources available as they have to spend less on software (see the “system on a chip” and other related discussions). As we see with the bigger and older companies – they don’t always have a monopoly on talent and personnel.

…tight HW/SW integration: I need to consider this more, but for now I am willing to concede the point. I haven’t spent a lot of time on the security analyses of Apple’s products outside of the decision by “above” not to use it for work, but I accept that the notional lockdown of their systems has allowed for greater initial security. Whether or not that’s because real attempts haven’t been made to crack Apple’s products, I do not know, but I doubt that’s the case.

…little to no platform fragmentation: I don’t understand theimpacts of this issue as fully as I want to or need to in order to discuss intelligently. I think the increasingly rapid pace and disintegration of service provider’s skinning of their units is going to force this to be dealt with eventually. Whether or not the resolution will be a good one, don’t know.

…little consumer confusion: agreed – I’m not able to envision any scenarios addressing this at the moment, short of “it no longer matters, Android is the predominant system and its model vs. model competition.”

And , you make a strong point when you say that Android needs Apple to know where to go next. Again, all I offer is a “for now.” Corporate use of Android unfortunately seems to be taking an “us too” approach – but at some point, the nature of Android will be driving “where else/what else” discussions. I believe the field is more open, more quickly to the Android ecosystem than the “Apple” ecosystem.

WCC: I appreciate the correction. Still, it’s hard for me to see a company as “marginalized” when, whatever their market share, they have the mind share and the profits and are acknowledged as the ones to beat.

True, Apple doesn’t have a monopoly on talented designers, and yet, no major consumer electronics company does what they do. All the rest act in the traditional way: “good enough,” too many cooks, lots of compromises, too many models, etc. Since Apple has been doing this for a decade and nobody has followed, I’d say there are institutional reasons that make this approach hard if not impossible to copy.

HW/SW integration is more than security, though: it’s about being able to tweak the OS and CPU and battery etc. all at the same time.

>I’d say there are institutional reasons that make this approach hard if not impossible to copy.

Nobody else has had Steve Jobs. That is, nobody else has a head honcho who is (a) a genius at spotting and pushing good industrial design, and (b) has a degree of authority to do so that is nigh-absolute – not questioned by the shareholders or anyone else. And committees suck at design even worse than mediocre designers do; you need a dictator to achieve Apple-like results.

Soon, Apple won’t have Steve Jobs either. At that point, we will see an interesting test of the theory I have just laid out. That theory generates this prediction: Apple will never again have a product launch as successful as the iPad’s. The company will continue to ship good designs on momentum for a while, but the Jobs spark is not replaceable and will dissipate. Expect this to become a serious issue in about three years from Jobs’s demise.

As some of you might know, Microsoft unveiled Windows Phone 7 Series yesterday, a complete reboot of its mobile operating system. While little is known about its internals, it’s most likely based on Windows Embedded CE 6.0.

Windows Embedded CE 6.0 has been released a long, long time ago. Perusing through the OSNews archives reveals that it was released November 1, 2006 – more than three years ago. Windows Embedded CE 6.0 brought with it numerous improvements over version 5.2, partially because the kernel was completely redesigned. However, despite being over three years old, Windows Mobile is currently still using version 5.2. The Zune HD, however, does use version 6.0.

Interesting…this proves out my earlier comment. Here was an opportunity (smartphones) to actually create something new and functional. What Microsoft did was the exact opposite: rehash something old and useless. There was no technical reason (hardware limitations or existing install base) to do that. I’ll say it again: it’s not in the culture to make something this fundamental new and functional. Microsoft simply isn’t capable. I’m sure their are individuals there who are; they’re probably the same ones who make contributions to Linux on their off time.

I’ll say it again: it’s not in the culture to make something this fundamental new and functional. Microsoft simply isn’t capable.

Correct.

Windows 95 was hailed as a new rewrite. It wasn’t. It was a juiced up win32s on top of a rehash of Windows/386 3.1. Windows NT was similarly hailed as brand new technology — it wasn’t. It was a rehash of OS/2 3.0.

Windows 2000 was hailed a new. It wasn’t; it was an evolutionary upgrade on Windows NT 4.0. Windows XP was a total rewrite, too. It also wasn’t; it was Windows 2000 with a new skinnable UI.

Windows NT was similarly hailed as brand new technology — it wasn’t. It was a rehash of OS/2 3.0.

It was quite a bit more powerful than any version of OS/2, based on a kernel by former DEC OS engineers led by Dave Cutler. OS/2 was very much to its dying breath a single-user desktop OS. A good one with a nice desktop, but that’s what it was.

>There was no technical reason (hardware limitations or existing install base) to do that.

But there was a perfectly practical reason. Ground up rewrites that succeed are the exception, not the rule. As others have pointed out, it’s not like iOS or Android are “new” by your definition either. The difference simply appears to be that Android and iOS are built on top of liked and robust bases, where as Windows 7 may not be, and no one is willing to give Microsoft the benefit of the doubt anymore (a reasonable position).

> but the Jobs spark is not replaceable and will dissipate. Expect this to become a serious issue in about three years from Jobs’s demise.

Oh, I don’t know. Jonathan Ive has been working there since ’97, and he and Jobs have probably been on the same wavelength for some time now. I suspect Jobs has been training people in his approach for years. Besides, I’ve said elsewhere that Apple might actually do better if Jobs dialed it back about 10%. In short, I don’t expect the magic go away if Jobs does.

> The difference simply appears to be that Android and iOS are built on top of liked and robust bases, where as Windows 7 may not be,

I think you meant WP7 instead of Windows 7 – two different things. W7, by Microsoft standards, is a solid product and arguably the best thing they’ve ever made. WP7 definitely not, if any of the previous comments are even slightly true.

I’m afraid I’m going to have to be pedantic here. The odds of an outcome have not a damned thing to do with its consequences. If you can assign some kind of benefit(cost) to each outcome of a choice you’re considering, then multiply each outcome’s benefit(cost) by its probability, and sum those products, you have a “mathematical expectation” of the overall benefit(cost) of the choice.

Winter Says:Egypt has been a self governed nation during the old pharaon reigns.

That was several thousand years ago, and back then, it had no definite borders, therefore no resemblance to a Westphalian state. It claimed to rule Israel, Assyria, Ethiopia, and so on and so forth, but clearly the Israelis and so forth did not agree.

The pharaoh’s power was absolute near the palace, and declined with distance, depending on the personality and competence of the pharaoh – Pharaonic Egypt was not a state, but a God King. Most of your other other examples show similar deviations from the Westphalian model, usually the same deviation: that they did not have definite borders, nor recognize each others sovereignty.

The Westphalian system is new, a creation of Europe, which never truly took root outside Europe and the English speaking lands, though the decolonialists exported a simulation of the system to most of the world.

So have been China, Japan, and many of the others.

Japan had definite borders, being an island, but until 1600AD, had a multitude of independent lords who could, and frequently did, take up arms successfully against each other or the central government, in so far as a central government existed at all. Therefore not similar to a Westphalian state. The rest of your examples had no definite borders, were not recognized by other states as sovereign entities, nor did they recognize other states as sovereign entities, therefore little resemblance to a Westphalian state.

Hmm, I don’t follow your point on “state-owned” telecom companies. At least there are none here in Germany. Yes, the T-Online was once the state-owned telecom, but got privatized in the 90s. The same goes for almost all of Europe (even the French nowadays have not only French Telecom but also Orange, Bougey etc.). It is the same in the energy market, which is UNLIKE the US pretty much privatized (though heavily regulated, how ironic).

On net quality, I have to say that I almost never have 3G but a lot of HDSPA. I think there are no 3G networks in Germany, unlike France which has more basic 3G coverage.
I think the statistic says more about stupid customers in Europe, which I am inclined to believe, because government dependence has proven to make people stupid in shopping around and getting information. I for one have unlimited web access and while I have several issues with HTC, I have no problems with O2.